SBI slashes MCLR, FD rates from Sept 10; home, auto loans could get cheaper
India’s biggest lender State Bank of India (SBI) on Monday announced reducing its Marginal Cost of Funds based Lending Rate (MCLR) by 10 basis points from September 10. The one-year SBI MCLR has been reduced to 8.15 percent from 8.25 percent. This means that the home loans, auto loans linked to MCLR are likely to become cheaper.
The MCLR is linked to the retail lending rates which are based on the bank’s own cost of funds. The SBI said that the decision was taken due to the ‘falling interest rate scenario and surplus liquidity’. It also said that the interest rate under the external benchmark will be reset once in three months.
In due course of time, other banks may also reduce their MCLR.